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Matthew Desmond’s new book, “Poverty, by America,” explores why the U.S. poverty rate hasn’t improved in half a century.
These figures show how bad the problem is.

A woman looks through a garbage can in Manhattan in New York City.
Spencer Platt | Getty Images News | Getty Images

1. Wages rose slowly for the poorest Americans

Since 1979, the bottom 90% of income earners in the U.S. experienced annual earnings gains of only 24%, Desmond writes, while the wages of the top 1% of earners more than doubled. His findings are based on data from a number of sources, including the U.S. Bureau of Labor Statistics and the Pew Research Center.
Looking at inflation-adjusted earnings, ordinary workers have seen their pay tick up just 0.3% a year for several decades, Desmond writes. “Astonishingly, the real wages for many Americans today are roughly what they were 40 years ago.”

2. More government aid for the financially comfortable

“Most families who enjoy those subsidies have six-figure incomes and are white,” Desmond writes. “Poor families lucky enough to live in government-owned apartments often have to deal with mold and even lead paint, while rich families are claiming the mortgage interest deduction on first and second homes.”

3. 1 in 18 live in ‘deep poverty’

In his book, Desmond, analyzing data from the U.S. Census Bureau and other sources, reports that 1 in 18 people in the U.S. live in what’s considered “deep poverty,” or what he calls “a subterranean level of scarcity.”
In 2020, this category included people who make less than $6,380 a year, or families of four living on less than $13,100. In 2020, almost 18 million people in America lived in these conditions, including some 5 million children.
“There is growing evidence that America harbors a hard bottom layer of deprivation, a kind of extreme poverty once thought to exist only in faraway places of bare feet and swollen bellies,” Desmond writes.

Arrows pointing outwards

4. Racial wealth gap is as large as in the ’60s

Looking at the work of other authors and Federal Reserve data, Desmond found that the racial wealth gap is as wide today as it was more than five decades ago.
In 2019, the median white household had a net worth of $188,200, compared with $24,100 for the median Black household.
“Our legacy of systematically denying Black people access to the nation’s land and riches has been passed from generation to generation,” he wrote.
Most first-time homebuyers, he explains, get down-payment help from their parents. And many of those parents are able to assist their children by refinancing their own homes, “as their parents did for them after the government subsidized homeownership in white communities in the wake of World War II.”

5. Overdraft fees mostly paid by the poor

In 2019, the largest U.S. banks charged Americans $11.68 billion in overdraft fees, Desmond found, looking at a number of reports, including from the Center for Responsible Lending.
Just 9% of those account holders paid the lion’s share, 84%, of those charges — customers who carried an average balance of less than $350.
“The poor were made to pay for their poverty,” Desmond wrote. More

As the cost of living remains high, 62% Americans now say they are living paycheck to paycheck, according to a recent report.
More people have found a side hustle to help make ends meet.
This is also a good time to make a few key changes to your spending and savings plan, one expert says.

It’s getting harder to keep up with higher prices.
As of February, 62% of all U.S. adults were living paycheck to paycheck, up from 60% a month earlier, according to a new LendingClub report.

To make ends meet, more people have picked up a side hustle, the report also found.
As pandemic-related benefits are scaled back, “many have turned to supplemental income with a side job or alternative income sources to improve their financial standing,” said Anuj Nayar, LendingClub’s financial health officer.
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Nearly half, or 44%, of Americans have a side hustle amid inflation, which is a 13% jump compared to 2020, according to a separate survey by LendingTree. Another report from FlexJobs found that 69% of employed professionals either have a side job or want one.
“What is clear: No matter your income bracket, having supplemental income greatly impacts financial stability and can often mean the difference between living without difficulty and living paycheck to paycheck and struggling to pay monthly bills,” Nayar said.

How to improve your financial picture

Instead of — or in addition to — earning more to help cover monthly expenses, consumer finance expert Andrea Woroch offers these spending and savings tips to beat inflation.
1. Refresh your budget. “Inflation has likely thrown your spending and savings plan out of whack,” she said. Start by going over your expenses and negotiate with current providers, or cut costs where you can, such as increasing your auto or homeowners insurance deductible to lower your monthly premium.
2. Purge useless services. Review each recurring expense and eliminate unnecessary services like unused subscriptions or memberships and premium movie channels you never watch, Woroch said.

3. Clear up debt. To keep up with higher prices, more Americans are leaning on credit cards and carrying debt from month to month, many reports show. If you’re struggling to pay off a balance, switch to a 0% balance transfer card, which may offer up to 21 months with no interest.
4. Tidy up your financial profile. Transfer your savings to a high-yield online savings account to earn a better interest rate and check that your bank isn’t charging monthly maintenance or service fees for overdrafts or insufficient funds.
5. Change your spending habits. Going forward, a good way to reduce the amount you spend is to avoid impulse purchases. Woroch advises shoppers to turn off sale notifications in store apps, unsubscribe from retail newsletters and avoid walking into stores like Target just to browse.
LendingClub’s paycheck-to-paycheck report is based on a survey of more than 4,000 U.S. adults in February.
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The collapse of Silicon Valley Bank and Signature Bank continues to prompt scrutiny of FDIC coverage limits, which are generally $250,000 per depositor.
On Friday, President Joe Biden said the FDIC may guarantee deposits above $250,000 if further instability occurs.
However, experts say it is possible to get more insurance on your deposits on your own.

Nicoletaionescu | Istock | Getty Images

When it comes to bank deposits, $250,000 is the key number experts are talking about in light of recent financial shocks in the banking sector of a severity not seen since the Financial Crisis.
That amount is the threshold for which bank depositors should be mindful of when it comes to whether or not their money is insured by the Federal Deposit Insurance Corporation, or FDIC. Coverage limits are per depositor, per ownership category, per bank.

Deposits below that amount are covered, while money above that threshold may not be insured if unforeseen circumstances occur at a financial institution.
Yet the government recently made an exception for people with more than $250,000 on deposit at Silicon Valley Bank and Signature Bank.
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On Friday, President Joe Biden said if further instability occurs, the FDIC may guarantee deposits above $250,000 again.
The $250,000 threshold was set by Congress in 2010. Some experts say that isn’t enough and should be raised.

Congress can temporarily suspend the limit. However, Treasury Secretary Janet Yellen has said uninsured deposits should only be covered in the event a “failure to protect uninsured depositors would create systemic risk and significant economic and financial consequences.”
Generally, most consumers do not have to worry about their deposits.

“If you have under $250,000 in a bank account, this is of no concern to you — you are fully insured,” said Jill Castilla, president and CEO of Citizens Bank of Edmond, a community bank located in Edmond, Oklahoma.
“It’s just whenever you are starting to see those limits that you might have some exposure,” Castilla added.
Experts say there are still ways to gain FDIC coverage even if you are over that $250,000 limit.

Find institutions guaranteeing higher deposits

FDIC insurance generally covers $250,000 per depositor, per FDIC-insured bank, per ownership category. But certain financial institutions may work around those limits by working with other financial institutions to guarantee higher deposit levels.
Citizens Bank of Edmond offers additional coverage, with a limit of $150 million per depositor, through IntraFi Network.
“If you’re able to use IntraFi, then you don’t necessarily have to go to another bank to get another $250,000,” Castilla said.

If you have under $250,000 in a bank account, this is of no concern to you — you are fully insured.

Jill Castilla
CEO of Citizens Bank of Edmond

Because the bank’s average deposit is typically $25,000, Citizens Bank of Edmond does not use the amplified coverage often, Castilla said.
To enroll, customers need to sign an agreement to allow the bank to use IntraFi to cover their deposits.
Customers can also review the list of banks in the IntraFi network and exclude those with which they prefer not to have deposits, Castilla said.
Those who sign up with IntraFi can choose from different products with either variable or fixed rates provided through money market funds or certificates of deposit, Castilla noted.

From the depositor’s standpoint, the process should be easy.
“The banker should be having these conversations with them if they have uninsured deposit exposure,” Castilla said.
Of note, there are ways of obtaining coverage for balances in excess of $250,000, including the Depositors Insurance Fund, which is privately sponsored by the industry. Some states also provide backstops for FDIC insurance, Castilla noted.
Other kinds of accounts may offer different protections, such as the National Credit Union Administration for credit union deposits or Securities Investor Protection Corp. for brokerage accounts.
To be sure, it is best to read the fine print to fully understand your coverage limits.

Add beneficiaries to your account

Another way of getting more than $250,000 in coverage for your deposits is to add beneficiaries.
If you have $1 million in deposits, for example, you would only have $250,000 covered on your own, Castilla said, leaving $750,000 uninsured.
But if you add four beneficiaries — a spouse and three children — that provides another $750,000 in coverage, or $250,000 per person, so long as those beneficiaries do not have other deposits at the bank, Castilla said.
Before you use this strategy, you should carefully consider how this will fit into your estate plan.

Per FDIC rules, deposits owned by one person without any beneficiaries are considered single accounts. However, once the owner of a single account designates one or more beneficiaries, the account may be insured as a revocable trust account, so long as it meets certain requirements.
Keep in mind that beneficiaries always get priority over a will, noted Carolyn McClanahan, a certified financial planner and founder of Life Planning Partners in Jacksonville, Florida.
“If you have a beneficiary account, then that asset is not going to go through your will,” McClanahan said.
Also, if you name your children as beneficiaries, but they are not yet 18, a guardian will have to take control of the money until they become adults, McClanahan noted. That can make it more costly for them to claim the money, she said.
Alternatively, you may establish a trust and specify in your will that the money should be held there until your children are of age. Then, on your bank beneficiary forms, you would name the trust instead of your children.

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Women tend to put other people’s needs before their own, and that sets them back financially, said personal finance expert Suze Orman.
How prepared you are to answer five questions may serve as a financial wake-up call, Orman said.
Plus, here are the three priorities Orman said everyone should have at the top of their to-do lists.

Suze Orman speaks during AOL’s BUILD Speaker Series at AOL Studios In New York.
Jenny Anderson | WireImage | Getty Images

At the end of each episode of her long-running eponymous CNBC show, Suze Orman would close out with the phrase, “People first, then money, then things.”
Women took that to mean they should give to other people and be generous, according to Orman. Men, on the other hand, took it to mean they should put themselves first.

Years after those episodes aired, there is still a distinct difference between how women and men handle their finances, Orman told CNBC.com in an interview.
At times, women can be their own worst enemy, said Orman, who is now a co-founder of SecureSave, a start-up working with employers to provide emergency savings accounts.
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Whether or not you take control of your money will have big consequences for your future, she said.
“You will never be a woman who owns the power to control her destiny unless you have power over how you think, feel and act with your money — how you save it and how you invest it and how you spend it,” Orman said.

“And none of you should be dependent on anybody else other than yourself,” she said.
The message is one Orman has been working to get across through her “Women & Money” podcast. The tagline for the show is “and everybody smart enough to listen,” and the show has a “tremendous” male following, according to Orman.

However, many listeners are older women — ages 60 and up — who “have absolutely nobody else to go to,” she said.
A key inflection point in these women’s lives tends to be the deaths of their spouses, Orman said. At that time, many women realize just how in the dark they are about their finances because they let their significant other handle the bulk of the responsibilities, she said.
Over the years, Orman estimates, she has talked to thousands of women in that same predicament.
Savings is one of the first places where women can start to strengthen their relationship with money, a concept that helped inspire Orman to co-found SecureSave in 2020.

You will never be a woman who owns the power to control her destiny unless you have power over how you think, feel and act with your money.

Suze Orman
personal finance expert

“There has never been a time more important for an emergency savings account since 2008 as there is right now,” Orman said.
A recent survey conducted by SecureSave found just 24% of women say they can pay for an unexpected emergency expense in cash, versus 41% of men.
Meanwhile, 64% of women said their personal savings had dropped in the past year, compared with 43% of men.
The results are evidence that women do not put themselves first, Orman said.

A wake-up call for women’s finances

Simpleimages | Moment | Getty Images

Women can test just how much they know about their money by asking themselves some key questions, Orman said.
They include:

If you own your home, do you know the interest rate on your mortgage?
Do you know the current interest rate on your savings account?
Do you know whether the money you have invested at a brokerage firm is insured?
Do you know if the money in your 401(k) plan is protected?
Do you know what your 401(k) or other retirement plan is invested in?

If you can’t answer yes to all of these, consider it a financial wake-up call, Orman said.
The less you know about your finances, the more likely it is you will make a mistake, she said.
“I always say to people the biggest mistake you will make is the mistake you don’t even know that you are making,” Orman said.

3 changes women should make now

Beyond brushing up on their financial knowledge, women should also make some key changes.
On a recent “Women & Money” episode, guest Sheila Bair, chair of the Federal Deposit Insurance Corporation from 2006 to 2011, said building up your savings now is “absolutely the best thing you can do.”
The ideal places to put that money include a bank, credit union or government short-term money market fund where it can be easily accessed, Bair said.
“The worst thing that happens to people is you get into a recession, they don’t have savings, their income goes down, then they have to borrow,” Bair said. “So they’ve got a debt load, too.”

Every woman should have a savings account, whether it is through their employer or independently, Orman said. Every woman should also have a credit card exclusively in her own name, she said.
As rising interest rates make carrying credit card debt more expensive, paying down those balances, if they have them, should be toward the top of their to-do list.
“They need to make that almost a No. 1 priority, as well,” Orman said.
Join us virtually for Women and Wealth, a CNBC Your Money event, on April 11, where financial experts will share how women can increase their income, save for the future and make the most out of current opportunities. Register for free today.

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A USB-C (USB Type-C) cable is seen in front of a displayed Apple logo in this illustration taken October 27, 2022.
Dado Ruvic | Reuters

Market experts continue to look for opportunities to pick promising stocks trading at attractive levels as recession fears linger. Here are five stocks chosen by Wall Street’s top analysts, according to TipRanks, a platform that ranks analysts based on their past performance.

Apple

First on the list is innovative tech giant Apple (AAPL). The company’s performance in the December quarter was significantly hit by iPhone-related supply chain disruptions in China, currency headwinds and macro challenges. Nonetheless, several analysts, including Evercore ISI analyst Amit Daryanani, remain bullish on the stock.

In a recent research note, Daryanani addressed investor concerns about his bullishness on Apple, despite its premium valuation compared to big tech peers. The analyst contended that in the current macro environment, Apple’s premium valuation is “not only justified but could further expand,” given its superior efficiency metrics like return on invested capital (5-year average ROIC of 39% compared to the peer group average of 21%), solid free cash flow and capital return.
Further, Daryanani stated that “AAPL has typically operated with a higher degree of consistency and importantly lower volatility.” He explained that the company was “more rational” in its hiring during the pandemic, unlike several tech companies that aggressively increased their headcount. Consequently, Apple avoided excessive stock-based compensation costs or layoffs.  
Daryanani reiterated a buy rating on Apple with a price target of $190. The analyst holds the 236th position among more than 8,000 analysts on TipRanks. Additionally, 60% of his ratings have been profitable, with an average return of 11.4%. (See Apple Blogger Opinions & Sentiment on TipRanks)

Cloudflare

Next up is Cloudflare (NET), a cloud-based content distribution network and security provider. The company has an extensive global network that reaches more than 285 cities in over 100 countries and powers websites, APIs (application programming interface), and mobile applications.
TD Cowen analyst Shaul Eyal thinks that the market is “underappreciating” Cloudflare’s ability to leverage the breadth of its global presence to “efficiently deliver new applications, including advanced security, with limited incremental cost.”

Eyal, who ranks 11 out of more than 8,300 analysts tracked on TipRanks, expects Cloudflare’s revenue to grow more than 38% this year, driven by new business and expansion within the company’s existing customer base. (See Cloudflare Hedge Fund Trading Activity on TipRanks)
Eyal noted that over 40% of the company’s revenue is generated internationally, and the company is “disrupting” several market segments, including infrastructure, telecommunications, security, and edge computing. Currently, these segments represent a total addressable market of over $115 billion, which is expected to grow to $135 billion by 2024.
Eyal reaffirmed a buy rating on Cloudflare with a price target of $75. Remarkably, Eyal has a success rate of 67% and each of his ratings has returned 24.1%, on average.

Foot Locker

This week, sneaker and athletic apparel retailer Foot Locker (FL) delivered upbeat results for the fourth quarter of fiscal 2022. The company revealed its revitalized partnership with Nike and long-term growth strategy, which includes several initiatives like transforming its real-estate footprint by opening new format stores, shifting to off-mall locations, and closing underperforming stores. 
Through its long-term growth plan, under the leadership of Mary Dillon, Foot Locker is targeting sales growth of 5% to 6% and adjusted earnings per share growth in the low-to-mid twenties range for fiscal 2024 through 2026.
Guggenheim analyst Robert Drbul expects Foot Locker to benefit from CEO Dillon’s “extensive knowledge and deep understanding of off-mall and big-box retailing.” That said, he thinks that the company’s strategic plan needs time to materialize as Dillon is still building her team.
Drbul reiterated a buy rating on Foot Locker stock with a price target of $60, noting that “2023 will be a reset year as Foot Locker navigates its revitalized Nike (NKE) relationship, repositions its Champs banner, optimizes its fleet, absorbs exit costs, increases its tech investments, and continues to drive cost savings.” 
Drbul is ranked No. 440 among more than 8,000 analysts followed on TipRanks. His ratings have been profitable 61% of the time, with each rating delivering an average return of 7.5%. (See Foot Locker Stock Chart on TipRanks)

Cisco Systems

Cisco (CSCO) offers a broad range of products and solutions across networking, security, collaboration, and the cloud. Tigress Financial analyst Ivan Feinseth recently reiterated a buy rating on Cisco with a price target of $73, saying that the company continues to gain from the rising need for faster, secure networks and cloud hosting infrastructure.
Feinseth noted that the company built up a large order backlog during the pandemic when corporate customers continued to upgrade their networks, fueled by “increasing demand for information access and supporting larger networks.”
“The recovery and growth of IT spending in 2023 and beyond, along with CSCO’s ongoing shift to services and software-driven subscription revenue, will continue to drive accelerating Business Performance trends,” said Feinseth. (See Cisco Insider Trading Activity on TipRanks)
The analyst also explained that Cisco’s solid balance sheet and cash flow continue to support its growth efforts, strategic acquisitions, and enhanced shareholder returns. Feinseth holds the 164th position among more than 8,000 analysts on TipRanks. Additionally, 62% of his ratings have been profitable, with an average return of 11.8%.
Acushnet Holdings
Feinseth is also bullish about Acushnet (GOLF), a company that sells golf products and owns leading brands like Titleist and FootJoy. The analyst recently upgraded GOLF stock to buy from hold and increased the price target to $62 from $50.
Feinseth expects Acushnet’s impressive brand equity and market-leading products, coupled with new launches, to drive further gains in the stock. Feinseth emphasized that the company’s 2022 results were boosted by double-digit sales growth in the Titleist golf club, Titleist gear and FootJoy golf wear segments.
The analyst noted that Acushnet’s 2022 performance benefited from a wide range of innovative products, including new TSR models that rapidly became “the most-played model on the PGA tour.” (See Acushnet Financial Statements on TipRanks)
“GOLF is well-positioned to gain from the ongoing post-pandemic growth in golf, including rounds played and growth in player population, especially from younger and new golf players,” said Feinseth. 

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Smart Tax Planning

As high-tax states find more ways to tax the well-off, more Americans are looking to relocate to seemingly lower-tax climes.
Keep in mind, however, that in states with no or low income tax you may pay up in other ways.
In order to keep your old, high-tax state from questioning your new domicile in a low-tax one, be sure to take several recommended steps to prove you’ve truly moved.

Mireya Acierto | Photodisc | Getty Images

It’s not unusual for wealthy taxpayers to relocate from high-tax states to low-tax states. There’s evidence in population trends: Texas and Florida — neither of which have a state income tax — were the states with the biggest population increases from 2020 to 2021, according to the latest U.S. Census Bureau data. Much of that growth is coming at the expense of higher-tax states such as California, New York and Illinois.
These days, it is very common for wealthy families to own residences in more than one state, making relocation even easier. However, the reality is that any state that does have an income tax, and in which an individual owns a home, will have a vested interest in asserting that the residence in their state is that person’s domicile.

In practical terms, having domicile in a state means that state can impose its respective income tax on all the income reflected on the individual’s federal income tax return, regardless of the source of that income. This is one of the principal reasons that many people consider relocating.

More from Smart Tax Planning:

Here’s a look at more tax-planning news.

Potentially adding to the trend of such moves is a wave of states’ efforts to find new ways to tax the rich. These bills range from imposing a “wealth tax” on the intrinsic gains from stocks and securities and creating special income tax brackets targeting the rich to reducing exemptions on inheritance taxes.
But before you call the moving van, understand that state taxation, including state income tax as well as state estate and inheritance taxes and potential wealth taxes, is only one factor to consider as you assess changing your domicile.
Other areas to consider include rules that govern asset protection, trust administration, trustee selection and estate administration. Some who redomicile to a state with no income tax may find that they are paying the state in other ways, such as higher inheritance, property and/or fuel taxes.

That’s why the state you choose as your domicile is such an important decision. That decision is even more challenging considering that states often have different rules defining what they consider domicile.

Some use so-called “bright line” tests; for instance, a certain number of days in and out of the state. Others use a “preponderance of evidence” approach that considers where you vote, where your driver’s license is issued, where your advisors are located and numerous other factors.

Tips for redomiciling ‘the right way’

Since I personally redomiciled from Minnesota to Florida and have assisted many of my clients in doing the same, I am often asked about “the right way” to do it.
The most important thing is to ensure, upon inspection, that you can demonstrate that the move is real and not just on paper. Simply getting a driver’s license or registering to vote in the new state will likely not be enough. Not surprisingly, states with high income taxes do not like to lose tax revenue from wealthy families and will very often audit taxpayers who say they’ve redomiciled.

When I have a client who is serious about changing domiciles, we go through a checklist of the things they should do to prove they have severed the connection to their former state of residence. The more evidence you can produce to show that you are domiciled in, and not just a resident of, your new state, the better off you’ll be, even if it only seems to be supporting evidence. Items to consider include:

Buy or lease property. The first step in redomiciling should be to purchase or rent a residential home in the new domicile state. If the residence is a rental, the term of your lease should be for at least one year.

Log your travels. Make certain to spend at least 183 days per year outside your old home state. Limit return trips to your prior home and keep a record of where you spend your time when you are not in the new state.

Change your license and registration. Obtain a new driver’s license and register any automobiles or boats in the new state. If you keep any licenses from your prior home, make sure they reflect that you are a nonresident.

Register to vote. Register to vote in your new state. Write to the registrar of voters at your prior home, too. Mention your change of domicile and ask that you be removed from voting lists.

File a declaration of domicile. In some states, like Florida, it is possible and advisable to file a declaration of domicile in which you attest to the fact, under penalty of perjury, that your domicile is the new state.

Move bank accounts and safe deposit boxes. It’s hard to make the case for changing domiciles if all your financial holdings are in the old state.

Declare a change of address. Send notification of your change of address to family, friends, business associates, professional organizations, credit card companies, brokers, insurance companies and magazine subscription offices.

Establish a new home base. When you travel, try to return to the new state. When you make large purchases, make them in the new state. Keep your family heirlooms, furniture and keepsakes in the new state.

Change legal documents to reflect residency. Upon redomiciling, you must update your will and trust and estate documents. Make sure that these documents do not identify you as a resident of another state. Also make sure your federal tax returns indicate your new address.

Develop local affiliations. Join local organizations in the new state, such as clubs and religious groups, and participate in local charitable activities.

If it exists, apply for a homestead exemption. In some states, such as Florida, a homestead exemption will be counted against your real estate taxes.

Each person has a unique tax situation. Please consult with your financial and tax professionals when considering a change in domicile.
— By Paul J. Ayotte, founding partner and client advisor at Fidelis Capital More

A contractor operates a roller on the construction site of the HS2 Ltd. Old Oak Common super-hub railway station, in view of the Vistry Partnerships regeneration project Oaklands House, in London, U.K., on Wednesday, June 23, 2021.
Luke McGregor | Bloomberg | Getty Images

Company: Vistry Group (VTY.L)

Business: Vistry Group operates as a housebuilder in the United Kingdom and operates in both the open market and the affordable housing sector. They seek to develop sustainable new homes and communities across all sectors of the U.K. housing market. On Nov. 11, 2022, Vistry acquired Countryside Partnerships for £1.25 billion ($1.4 billion). Vistry operates through a partnership model, which is unique to the U.K., where they seek to reuse land wherever possible, focusing on mixed-tenure developments that deliver positive social impact. The partnerships business operates across 19 business units and works closely with governmental bodies, housing associations and local authorities, as well as selling homes directly to customers on the open market.
Stock market value: $3.09 billion

Activist: Inclusive Capital Partners

Percentage ownership: 5.9%
Average cost: n/a
Activist commentary: Inclusive Capital Partners is a San Francisco-based investment firm focused on increasing shareholder value and promoting sound environmental, social and governance practices. It was formed in 2020 by ValueAct founder Jeff Ubben to leverage capitalism and governance in pursuit of a healthy planet and the health of its inhabitants.
As a pioneering activist ESG investor (AESG), Inclusive seeks long-term shareholder value through active partnership with companies whose core businesses contribute solutions to this pursuit. Their primary focus is on environmental and social value creation, which leads to shareholder value creation.

What’s happening?

On Wednesday, Vistry announced the appointment of Inclusive’s Ubben as a nonexecutive director to the board and the upcoming resignations of two incumbent directors, Katherine Innes Ker and Nigel Keen.

Behind the scenes

Vistry landed on Inclusive’s radar as a result of their engagement with another company – Countryside Partnerships. In May 2022, Inclusive had a 9.2% stake in Countryside and had made two bids to acquire the company, going as high as £1.5 billion. Both bids were rejected.
But Inclusive’s interest sparked significant shareholder pressure to sell Countryside and the following month, the company announced that it was seeking a buyer. On Sept. 5, 2022, Vistry agreed to acquire Countryside in a cash and stock deal, which closed on Nov. 11, 2022.
In the four months since the Countryside acquisition, the market has reacted favorably to the combination. Inclusive led the charge on the merger and now they are taking an active role at the combined company.
Vistry operates through a partnership model whereby the land is provided to them by governmental land authorities at no cost and they commit to build a certain amount of affordable housing. They build communities that are mixed tenure, placing affordable housing among open market homes, retail stores, etc. This model has the benefits of a secular shift to affordable housing and is capex light since they do not have to acquire the land. The company trades cheaply at 7 to 8 times earnings and has high growth prospects, complimented by their community benefits.
Inclusive said Vistry’s business model gives it the scale, operating synergies and resources to deliver societal benefits and great long-term returns.
On Wednesday, Ubben was named a director and two board members, Innes Ker and Keen, resigned. Inclusive is an amicable investor that is often invited onto boards. This situation is no exception. However, the exit of two incumbents alongside Ubben’s appointment indicates that there was a call by shareholders for a bigger board refreshment than just adding one shareholder representative. While this type of action is somewhat unusual for a European company, it is worth noting that the company’s five largest shareholders representing 40% of the stock are all North American investors who are more likely to engage with management than European investors.
This leaves a board that is undergoing a refreshment process and a CEO who is universally well liked and on the same page as shareholders opening the door for a methodology that has worked very well for Ubben going back 20+ years to ValueAct – let a good management team continue to generate cash flow and sit on the board and help advise the best way to use that cash flow.
One tactic he has used successfully in the past to grow shareholder value is to do a share repurchase at the bottom and keep cash when the company is fairly valued.
Finally, as with all Inclusive investments, this one has an impact element as well as a value element. The AESG thesis here is obvious as the core purpose of this company is to further social equality – developing affordable, sustainable housing. What is interesting about this from an ESG perspective is that it is a social ESG thesis, which is generally the most difficult type of ESG thesis to monetize. But, in this case the community benefits align so perfectly with the company growth prospects – topline company growth means more affordable housing.
Ken Squire is the founder and president of 13D Monitor, an institutional research service on shareholder activism, and the founder and portfolio manager of the 13D Activist Fund, a mutual fund that invests in a portfolio of activist 13D investments.

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Three-fourths of Medicare beneficiaries are worried about affording their out-of-pocket costs, compared with 43% who say the same about their premiums, a survey shows.
Basic Medicare (Parts A and B) has no out-of-pocket maximum; nor does Part D (prescription drug coverage) under current law.
Here are some costs that can help you consider how much you may spend, depending on your coverage choices.

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For retirees, health-care costs can be among the most unpredictable expenses they face over the course of their golden years.
While many of them worry about affording their monthly Medicare premiums, their bigger concern is their out-of-pocket costs, according to a recent report from eHealth.

The report says 75% are either “very” or “somewhat” worried about affording those costs, which include deductibles, copays and coinsurance. That compares with 43% who worry about their ability to pay their premiums, according to the report, which is based on a February survey of more than 4,500 Medicare beneficiaries.
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Exactly how much you spend on Medicare depends on both your coverage choices and your use of the health-care system. However, you may be able to pinpoint a worst-case scenario to help you budget.

Beneficiaries have coverage options

Basic, or original, Medicare consists of Part A (hospital coverage) and Part B (outpatient care) and covers 65 million people — 57.3 million are age 65 or older, and the remaining 7.7 million are younger with permanent disabilities.
Many beneficiaries choose to get Parts A and B through an Advantage Plan (Part C), which also typically includes Part D (prescription drug coverage) and often other extras such as dental and vision.

These plans often have no monthly premium or a low one, and they limit how much you pay out of pocket each year for covered services. Deductibles, copays and coinsurance vary from plan to plan.

Other beneficiaries instead decide to pair Parts A and B with a standalone Part D plan and, often, a Medigap plan, which covers part of the out-of-pocket costs that come with Parts A and B. However, premiums can be pricey, depending on where you live and other factors.

Basic Medicare has no out-of-pocket limit

If you have only basic Medicare, there is no cap on what you might spend in any given year.
“With no secondary coverage, there is no out-of-pocket maximum, which leaves a beneficiary financially exposed,” said Elizabeth Gavino, founder of Lewin & Gavino and an independent broker and general agent for Medicare plans.

How hospital stays are covered

Part A, which comes with no premium for most beneficiaries, has a deductible of $1,600 when you are admitted to the hospital. That covers the first 60 days of inpatient care in a benefit period.
Days 61 through 90 come with coinsurance of $400 per day, and then it’s $800 daily beyond that (so-called lifetime reserve days). And for skilled nursing facilities, a daily coinsurance of $200 kicks in for days 21 through 100.
If you have Medigap, all of those charges are either fully or partially covered under most plans. 

Out-of-pocket maximums may range up to $8,300

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With Advantage Plans, because the cost-sharing differs from plan to plan, “they will all vary but at least their hospital spending would count toward the plan’s out-of-pocket maximum, meaning it would be capped,” said Danielle Roberts, co-founder of insurance firm Boomer Benefits.
In 2023, those maximums can be as much as $8,300 for in-network coverage, Roberts said. 
“In most urban areas, you can find good plans with considerably lower limits,” she said. “If you can find a plan that has a lower out-of-pocket limit, such as $3,000 or $4,000, that is a benefit to you.”

‘The sky is the limit’ on Part B coinsurance with basic Medicare

Part B — which comes with a standard monthly premium of $164.90 in 2023 — has a deductible of $226. But after that, you pay a 20% coinsurance for covered services with no cap on how high that goes.
“It means the sky is the limit on the 20% coinsurance,” Roberts said. “Imagine trying to cover 20% of eight weeks of chemotherapy or for dialysis for the rest of your life or until you get a transplant.”
“In my opinion, this is the most important thing that you want to get covered,” she added. “Both Medigap and Medicare Advantage Plans do a good job of this, since most Medigap plans cover the 20% [coinsurance] and Advantage Plans have caps on Parts A and B spending.”

Part D currently has no out-of-pocket maximum

Under current law, there is no out-of-pocket limit associated with Part D, regardless of whether you get your coverage as a standalone policy or through an Advantage Plan.
A deductible for Part D, which may come with a premium, can be up to $505 in 2023, also regardless of how you get the coverage. 
Part D does come with catastrophic coverage that kicks in once out-of-pocket expenses reach $7,400 in a given year, Roberts said.

After hitting that threshold, “you pay only a small coinsurance or copayment for covered drugs for the rest of the year,” she said.
In 2025, each beneficiary’s annual out-of-pocket spending for Part D will be capped at $2,000.
Also be aware that Medigap plans do not cover any Part D costs.

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